Zimplats to help cushion parent’s performance

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  • Concentrate production at Zimplats to slightly increase
  • Potential risks to output associated with COVID-19 have not yet materialised
  • Lower concentrate production at Mimosa

Harare – PGM miner Impala platinum, parent to Zimplats and Mimosa anticipates a marginal concentrate production at Zimplats for the year ended 31 March 2020 compared to the prior year.

In a market update, the miner highlighted that concentrate production at Zimplats is expected to be between 585 000 ounces and 600 000 from 572 000 in 2019 ounces.

Concentrate production at Mimosa is however expected to contract by between 4% to 8%. Production is anticipated to be between 240 000 ounces and 250 000 ounces compared to 261 000 ounces produced in 2019.

The group said both Zimplats and the joint venture at Mimosa have operated uninterrupted and well within pre-Covid-19 FY2020 guidance

“Despite the indefinite extension of the national lockdown, permission to continue mining operations remains in place and, to date, potential risks to output associated with virus-related employee attendance and supply chain and logistical challenges have not materialised.” said the group.

Residual concentrate and matte inventory accumulated in-country during the IRS force majeure period is expected to be delivered to Impala’s Rustenburg processing facilities in full by Q1 FY2021.

Commenting on the expected 2020 results, the Chief Executive Officer, Nico Muller said that, “Through collaboration and co-operation between employees, union structures and management, we have created safer workplaces, and, a better-than-expected production performance across Group operations in the final quarter of FY2020.”

He added that logical constraints eased and despite the undeniable impact of the pandemic on global economic activity, demand for metal from its customers remained robust allowing the group to capitalize on a reduction in excess inventory and a period of robust rand PGM pricing.

The ramp-up of production in the South African operations has surpassed initial expectations, with revised operating protocols proving effective in mitigating the impact of potential virus-related interruptions at the group’s South African mines, which had returned to circa 85% of capacity by mid-June 2020.

The miner highlighted that smelters and refineries were identified as ‘essential services’ during the national lockdown in South Africa and the systematic ramp-up of operations and continued, albeit reduced, production of refined volumes has resulted in the group being able to fully refine the previously identified excess in-process PGM inventory. As a result, refined and sales volumes will exceed concentrate production in FY2020.

Implats also added that, “Given production rates relative to plan in FY2020, a decision was made to bring forward the annual acid plant maintenance scheduled for July 2020. This is expected to result in greater-than-usual alignment of processing and mining capacity in Q1 FY2021 but will have a small impact on the FY2020 year-end processing inventory.”

Implats expects to release FY2020 results on 3 September 2020.

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